tv Squawk on the Street CNBC June 18, 2014 9:00am-11:01am EDT
>> yeah. >> that's part of the reason of not being more zealous. >> it's the uncertainty trumping profitability. >> bob, thank you. >> thank you. >> thank you for laughing at my jokes. >> thank you. >> it's nice. i'll take what i can get. join us tomorrow." squawk on the street" starts right now. good morning, and welcome to "squawk on the street," scott walker with jim cramer, carl's on assignment, david is off. >> we are here. >> we are here. we are not going anywhere. >> let's get that straight right up front. >> like the futures not going anywhere yet, but we know there's a fed meeting today. we are watching what the stocks are doing in premarket, implied open higher across the board. the ten-year yield, the note there, it's a big fed day, and
there it is. yields falling today, jim and i have more on that. as for europe. let's look at what's happening overseas, mostly green picture. except for -- well, italy's red, but the rest is good. road map starts with fedex delivering the fiscal fourth quarter, shares higher in the premarket. the shipper forecasting better results next year. ready, set, fed concluding the two-day meeting. what does that signal about growth and possible rate hikes? seeing the forest through the trees? amazon expected to unvail a new smart phone at a media event later today, but likely has nothing to do with talking. fedex, 246 a share, beat estimates by a dime, helped by higher volumes in the ground business, and fred smith called the quarter outstanding adding, he believes the company is well
positioned for a strong current fiscal year. this was a nice snap back, jim, right? from the winter that just cru crushed them. >> higher ground volume. positive impacts of highly average daily shipments, improved operational efficiencies. this company in the '80s, first down down 8 8 %, and it was good, fred smith said, okay, we're done losing money here, done losing money operationally in places we should be making money. this is a term like i have not seen in a long time. >> wow. up 4%. >> remarkable. >> they switched to dimensional right. >> yes. >> what is that? ordered 15 rolls of paper towels, charged more? >> you don't bring them via drone yet. >> yet. >> maybe a picture phone, i
don't know. >> better be a big drone. paper towels are 25 rolls in one thing now. >> that's where the drones are. i know they are not over there in iraq. >> ups made a move recently to counteract this. what stock do you like better? ups or fedex? >> i like scott davis. i don't like to hold a stock in the first year of the new ceo. it's a cleanup period. 8%, waiting for that number for ages. less than truckload average daily shipment, 12%, those in the trucking business or know it, fortunately, i do. this means the economy is great, and fedex is capitalizing. >> fred smith, modest improvement expected in 2015. cautiously optimistic to frame that as? >> if you're janet yellen, listening to this, mortgages -- well, too restrictive, don't have big household formations, not great housing.
you're shuck. again, fedex is doing great, but not ready to hire. they should be, right? things are so good, but everybody's so lean that it just never translates into more jobs. >> oh, boy, that's the subject of the biggest discussion out there, right? lean, mean, they've got the green, and yet they are sitting on it. >> two kpocompanies ceos came oo make money. business is so good, they hire. what happens to a company's stock when it announces they are hiring? stock gets clobbered. you are not supposed to be hiring, make money and fire. >> put that under the mattress. don't hire people. wrong. we wish that was not the case. >> they are certainly not putting it under the la-z-boy. the fed the concludes at 2 2:p.m. eastern, and the fed expected to further cut the bond
buying program by $10 billion to 35 billion a month. investors watching to see if the fed says anything about the growth forecast and a future rate hike. jim, i can tell you, whether the fed says anything about it, there are a lot of people thinking about it today given the surprising inflation number that spooked the market and people think now, is the fed going to raise interest rates sooner than people think? >> you know, continue to loves to get the "usa today". all right, air fare, electricity, medical services, shelter, gasoline, power, used cars, poultry, beef, tomatoes, avocado, fish. what's down? now, if you're the fed, okay, some of these are because of the drought in california. all of them? no. then -- this is amazing. air fares -- why did that happen? because the republican justice
department and the protrust department blessed mergers that made it so there's only one guy flying everywhere. you know, you don't have to raise fares if it's you against yourself. delta, one route, they raise fares with impunity, no cheap carrier comes in because you can't get a plane because plaeps are spoken for. wheels up, and you pay five times that you pay with delta. what we absolutely know is air fares are higher because there's no competition, and the government mandated that, and i have no idea why they did it, but it's working in favor of the shareholders. >> yeah, and you've been speaking about the action in the airline stocks even with what's going on in iraq in oil prices. i read what you said about that. >> look, if they -- if the -- if isis takes the south -- i care more about -- ridiculous, one
million barrels a day coming from north dakota, passing every other state other than texas. it means american air won't do my $6 i'm looking for. they do something under. american is six bucks. stocks at 40. company's spinning off cash like left and right. >> they make money now hand over fist. fares go up, nickel and diming for peanuts and everything else, 30 bucks for a bag, first bag, and more for next bag. >> you have to share a seat. i saw the fat seats, they call them that in brazil, i don't know, but the seats, look at bea. they did not -- they pulled the deal. bea makes the seats in most all airlines, but you're losing everywhere in the airline. look at spirit, does so well because they charge for everything. look the delta, american, they charge for a lot too, spirit just makes them look like they are gracious. >> other big story today,
clearly, amazon. holding a media event later today at which it's expected to up vail a new smart phone. speculation that phone will have a 3-d screen with the emphasis on mobile shopping and many of the phone's features will be tied to amazon's prime membership program. it's also expected at&t is the exclusive carrier for the smart phone. how do we view this news today? i know you love what the company is doing. >> yes, i do. >> you love everything about it except this evaluation. >> look, one of the things that the march to may sell off taught us is when stocks go down, you have no friends, shorts lean, fox holes, marginal line there. they are underneath, not going to help you. rob peck, i think, he's been great at suntrust. >> he's on our show at halftime too. >> i did not know that. synergy, look at that promo. it happens without knowing that
you're doing a promo. of course, one of the things -- gross profit could lift 1%. now, i like gross profit. amazon doesn't have that much of it. this is the problem. you get behind them now after a big run, and then the market changes coloration, fed says the wrong thing. why did i like amazon? oh, that phone thing. i i'm just saying, earnings per show. abobe has earnings per share. i do not have to give you faux cloud. a live shot in seattle where the live event takes place this afternoon. expected to unvail a phone. who knows if it's -- we presume it would be. >> do you have a kindle? >> i do not. >> i have a kindle. i have an ipad. i mean, you know, i'm -- i like to think i'm alone in having every one of the devices. seems like everyone has every
device, playing gaming, signing up for netflix while watching, amazon prime, and googling everything. amazonments to be the company of everything, right? >> yes. >> are they going too far afield to do this? i bring into play here john ledger's tweet from t-mobile. amazon do you want know what they just signed up for. remember the facebook phone? hashtag yieks. >> he doesn't want to see stevenson -- just call -- you got the shirt. just -- i have a shirt similar to what he wears. he's a competitor, and at&t did that with the iphone. maybe he's playing that game. i mean, i love him for that, but he is playing a bit of a game. >> does he raise an interesting question though? >> i don't know. i was with someone this weekend trying to get a job with google
because the driverless car is here and they team up with uber for driverless taxis in new york and everyone makes a fortune. i thought google -- but they are raising evaluation to 19 billion on what i said. we are in a weird moment where they mold and task the way 19 -year-olds multitask. do you think that elan musk, the four hour interview, longest interview in history, he's talking about -- >> going to go to mars. >> put a man on mars. i think, he probably thought about putting a man on mars next year. maybe that's not hard. what's the time frame? 2014 last quarter? >> yeah, right. >> making numbers worse. >> by the end of the year. >> yeah. what gets you to the point to look at amazon for all that they are doing and then look at the stock and feel as good? >> the shorts. the people who have to cover. look at zillow. that's a 33 % float.
spencer, tweet me, i know, i love you, spencer. the shorts didn't get to cover in the last down leg for the stocks. i don't know if you saw the velocity of the sales force move yesterday, the 3.25 move, the shorts are in there scrambling, and what happens if you take out the highs, then the charts come on. we know the charters. they are on all day. amazon booked double top, golden cross, the momentums failed to cover, now worried about their quarter, such a great short selling quarter, scott, you have great people on all day in the show. it is clear if you don't cover your shorts in this period or janet doesn't say stocks are too high, you give up all the great quarterly gains you worked for, those are the marginal people determining whether the market goes higher or not. a programming note as well, watch the cnbc original
documentary, "amazon rising" hosted by david faber, airing june 29 th at 9:030 p.m. eastern. going to be fabulous. turmoil in iraq and its effect on oil prices. ahead, if you're a twitter user, you most certainly know about bit.ly. we'll talk with mark josephson. let's take another look at the futures. there they are, implied open, to the plus side, more "squawk on the street" from the new york stock exchange when we come back. i make a lot of purchases for my business. and i get a lot in return with ink plus from chase. like 50,000 bonus points when i spent $5,000 in the first 3 months after i opened my account. and i earn 5 times the rewards on internet, phone services and at office supply stores. with ink plus i can choose how to redeem my points.
travel, gift cards, even cash back. and my rewards points won't expire. so you can make owning a business even more rewarding. ink from chase. so you can. just take a closer look. it works how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review.
all right. welcome back to post nine. oil prices on the rise after sunni mill at that particular times attack the the largest oil refinery. in iraq, cnbc chief correspondent michelle has the latest. >> reporter: yeah, a key development today, president obama meets with congressional leaders this afternoon to consult with them about the situation in iraq as it grows more critical. you talk about the refinery, a center of strife. the largest remine ri in the country, produces gasoline, fuel for the grid. video on social media websites show smoke rising from the
refinery. rebel fighters and iraqy military fight r for control. it started last night, and they have not been able to independently confirm this video. one of the results of this situation with the refinery, take a look at the extremely long gas lines that can be seen throughout this area, kurd stan in northern iraq. it's not producing now. second, trouble transporting fuel period because the roads are closed, and then there was already a hording mentality going on because people were concerned about disruptions. the lines are long. some gas stations do not have any gas at all. at the same time, there is fighting going on on the outskirts in the north, one of the three -- area where one of the three largest oil fields in iraq is located. it's the largest in the north, and there's intense fire fights going on with militants on the outskirts of that area. we met with the governor this
morning in the city where he is -- there's not any fighting. it felt quite safe, but we talked to him about what it was like to see the iraqi military completely disappear, stepping in, and he says he was not surprised they had to replace the iraqi army. >> the iraqi army we knew had deficiencies. it was a check point army. it was not army in a sense that you have discipline, training, commitment. that was not there. >> reporter: check point army, in other words, they ran check points of which there are many throughout iraq and especially now, but when it came to fighting, not so good. guys, back to you. >> okay, michelle, thank you so much for the latest as we watch the energy market. scott, sorry, air product up $7. i have to know what's going on.
people are buying. >> it's doing well, jim, as you mentioned. they have a new ceo named today, a gentleman by the name -- was on the board, doing a search since september, bill ackman's persing square, finally name a new ceo, a gentleman from rockwood holdings which is a big industrial gases company, has done incredibly well. this gentleman is very highly regarded. bill akcman told me a while ago on the phone he is enormously high regard for him and the board, in this case, made a brilliant choice, that he'll run the company better, it's been undermanaged for 20 years. he's been in the specialty chemicals business and done incredibly well. he's in his late 60s. maybe you think about this in the way that ackman thought
about cp, canadian pacific. strong industrials guy, guy in his late 60s, a great track record. >> could rate the company. >> could separate the company into specialty chemicals, gases. that's looking at the situation and saying, hey, maybe that's out there down the road, but the stock has certainly performed in a manner which shareholders like this move. it's a very shareholder friendly ceo. >> when we talk about the negatives, what yellen says, i come back and say, okay, new ceo, stock goes up 7? i can't recall any time in my career that we have things like breakups, just someone drawing a line on a paper, tax inversions, new ceos, this is the problem with betting against the market. you might have bet against them. i don't know if they make the number or not.
suddenly, you are slapped upside the head by a new ceo. >> you have a guy who's been on the board, jim, for nine months of the company. >> right. >> he was put on the board nine months ago. he has a very good track record in industrial gases, okay? he's on the board of air products for nine months studying what's going on there, and now maybe ready to take action in the ways that the prior ceo had not taken at least according to what other shareholders believe is necessary. >> glad you explained it. i don't like when stocks are up 7. >> now you know why. up next, it's cramer's mad dash counting down towards the opening bell. more "squawk on the street" straight ahead. the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs.
become the next business to discover the new new york. they challenge us. they take us to worlds full of heroes and titans. for respawn, building the best interactive entertainment begins with the cloud. this is "titanfall." the first multiplayer game for xbox one built and run on microsoft azure. letting gamers around the world interact in ways they never thought possible. this cloud turns data into excitement. this is the microsoft cloud.
. welcome back, six minutes away from the bell this morning. time for cramer's mad dash ahead of the market open. we're talking about adobe. >> yeah, now a lot of companies have said, you know what? we're cloud. microsoft. we're cloud. okay. you -- ibm, we're really cloud. now, adobe made a decision -- well, in the 30s, they had to switch to the cloud. you are beginning to see the results of this amazing transformation. this is when salesforce.com, remember, at the end of february they reported good cloud numbers, stock went down, took the other stocks down, shorts in adobe here didn't cover here,
and now you see the hazards of staying short. delivered an incredible number, the numbers go higher, price targets go up to $85-90. congratulations. i want to hear from the ceo, which we're going to, how good am i at teasing? >> nobody better. >> i grew up teasing people, but that was at my hedge fund business. it's a thing of beauty. it's shakespeare, okay? this is prince hal going to king hen henry v. the opening bell is just moments away. bulldog: ah, the dog days of summer!
time to celebrate with your mates, grill a few dogs-- eh, hot dogs. bacon burgers... dachshund: "mattress discounters 4th of july sale"? bulldog: that cloud reminds me of... radio announcer: the tempur-pedic cloud collection. bulldog: that's it! radio announcer: now with 48 months interest-free financing-- basset hound: free financing? radio announcer: or get a queen size serta pillow top on sale for just $597. bulldog: that's a ringer of a deal! radio announcer: the 4th of july sale is on now. dog: come on, let's go! bulldog: hey! where's everyone going? ♪ mattress discounters
being able to pay as we go to is crucial for a start up.deas. having to fork out a lot of money up front was risky. we can launch a feature really quick, and if the feature doesn't work, we haven't lost anything, and we can have something up and running in days. and this would not be possible without the cloud. we are now supporting over 25 million users each month. became big business overnight?
♪ like, really big... then expanded? ♪ or their new product tanked? ♪ or not? what if they embrace new technology instead? ♪ imagine a company's future with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. you are watching cnbc's "squawk on the street" live from the financial capital of the world where the opening bell is set to ring in just a couple minutes. jim, you raised a question on mad as to whether we'll look back at the situation in iraq like we look back at the situation with the ukraine. >> it's possible. i mean, i think that you got the
press saying tensions rising, escalating, and at a certain point, the tensions stopped escalating because what happened is the russians got to where they wanted to go. they wanted the crimean border, okay, they wanted -- they didn't want kiev, we found that out, when we thought the tensions were most rising, the russians stopped. the moment you think tensions are rising, careful. maybe they just want a sunni country, okay? break it up into three so don't overstay your welcome. you see a refinery on fire. it's in the area they hold. i -- iran is not going to let the sacred -- these sacred sites fall into the hands of the enemy. i know it sounds odd that i say iran, but it's becoming a public government. >> our partner in this thing. that refinery fire that is in
iraq doesn't affect exports, oil, production. >> does not affect 90% of the oil. >> glad you brought that up as we watch this today certainly. okay. you are watching the opening bells and s&p 500 at the cnbc realtime exchange, celebrating the ipo today, century community, a home builder in colorado, texas, and nevada, and up at the nasdaq, veterinarian pharmaceuticals company celebrating its ipo today. >> ipo market is back. not at the beginning, but every since jd.com and aent, you are getting a robust market. be careful. when it's too robust in the month of february and month of march, there was a huge selloff. it's the beginning, just a note of caution. >> one of the words out there, jim, over the last couple weeks, certainly, is complacency,
investors come place sent with the market, and now with the fed, oh, nothing's going to happen today, but then you did have the boe's carney put out there interest rates need to rise sooner than the markets expect. what shock value is out there for yellen today if people are not taking it seriously? >> u.k. has the strongest economy in the world. they have a real estate bubble that reminds me of 2006 and 2007. yellen is looking at job growth, and we don't have great job growth. we have the student loan tuition problem, the rise in taxes, we do not have mortgage applications. you know, if you come in right now, and say, listen, the economy is too hot, you're carney without the economy being too hot. be careful if you're yellen, interest rates tell you things are not on fire here. you know, because there's a
news conference today as well, it only takes a couple words. >> remember may? the run from 2.4 to almost 3% on the 10-year. people went the wrong way. you're absolutely right. too come play sent on that? it was rocked between may -- we forget between march and may, we had 50% declines in the momentum stocks so it's like i feel -- when we get back to the point where everything started falling and no one takes profit. that's the measure i'm looking. >> no one's taking profits today in fedex, jim, buying the stock, up 4%. >> they were not supposed to do this well. >> good outlook from fred smith as well, better than people thought. >> no, they were not supposed to do this well. time and again, pricing increases do not work, not a lot of worldwide commerce. fedex, great quarter. someone says pent up demand,
results of great restructuring, obviously, that was good, but i think fred is very articulate. we'll hear from him later today. fedex -- if yellen takes a cue from them, rates higher, from the housing market, rates are doing nothing. stock's up 1%. products, jim and i, speaking about this, you know, a little bit earlier, a new ceo in place, bill ackman is happy about the pick, the board made a great choice. investors seemingly agreeing this morning. stock up 7%. walgreen's jim, upgraded today, stocks up nearly 2%. >> the barclay's team is strong about this. look at the walgreen's research, they are saying, look, there is going to be something major that happens at walgreen's, tax inversions, many things could happen. wow, doing a fabulous job there. they are cheering. i think walgreens can go higher,
makes a strong case the stock could go higher. >> from hold to buy. gap with a good morning as well. about 1%. >> i don't know. look. i think that apparel has been very, very hard. look at all the companies that put up the red flag lately. chico's, jones went private, express, there's a possible bid there. apparel is very, very hard, and those who think that they have figured out apparel, i think you're dreaming. >> the best piece of research every morning is your note that you put out every morning to us. >> that's a secret, that note. >> well, it's not a secret anymore. morgan stanley starting cisco with a buy. up 6%. doing cisco is returning to greatness? >> let me back up, david faber is good friend, as you are,
friends in life, david kids me because i say, cisco's back. the morgan stanley note, they are back, juniper, john chambers reinvigorated the company. i think they will have a good computerment i think that cisco is once again like intel. the king of its domain, so i think the morgan stanley piece was a nice recognition of them. >> you've been on this when people looked at cisco as being left out in the cold. they are out performing the market this year. >> look at anet, one of my new favorites, one of the deal, they thought it was records because they are a bunch of idiots, but a better mouse trap. they will try to catch up. cisco in the united states has done well. intel says enterprise spending in the united states is doing better. people have to recognize the enterprise is better even if the
consumer is not doing better, strapped by inflation, higher taxes, or tuition problems. on a day we talk about amazon, possibly, probably unvailing the phone, apple was down this morning for a short period of time. >> apple had a new mac today. >> apple's down slightly. amazon is up ahead of this announcement. this new phone, i mean, how would you view apple relative to amazon if they do come out with this new phone, if it has 3-d, some of the, you know, ground breaking or spectacular features that people are expecting? >> i think it depends on your provider. i mean, if at&t decides to give a phone away, they have been able to dent. at&t's pickup by ran doll stevenson, blindly saying i'm going to go with apple? that really put apple with the mac. i want to see what the providers do. i got to tell you, if verizon, my carrier, if they send me something, come on -- they won't
now, but if at&t gives away the phone and verizon doesn't? i think we're going to take a look at it. we have to take a look at it. it's important. >> yeah, that happens later this afternoon. >> i'm not selling out, taking -- sell apple this, playing that game, that game people play, so good, hedge funds, bringing apple down at 7 00, banging it at 600, back at 500. see, apple split, removing -- here's what no one talks about it. it removed volatility. it's a retail name again, no longer a play thing of the hedge funds. we got to get to -- quickly, the chips, another firm jumping on the micron band wagon. ships called out. >> airlines and chips. incredible consolidation. when they were bought for 2 .5
billion, what you did is take out a tremendous amount of supply. there's three companies that control the market. they are rising prices because there's no competition. again, because the protrust department of our country -- if you didn't know better, president obama is the biggest friend of business when it comes to mergers. no one wants to give that to him and he doesn't want to claim it, pro-business, but that's what did it. there's no -- every one of the guys was so negative and down beat, they decided not to open factories. every time i've ever seen micron get to the point, they are not building factories. there's no new supply. they raise prices at well. remarkable moment. intel cut back. czech guy came in, the first intel's engineer in ages and came in, he's not adding a lot of supply. when you don't have new
boundary, raise average selling prices, stocks higher. again, congratulations on that air product. >> oh, thank you, man. >> stock up nine. one to watch. bob is on the floor with what's moving, bob? >> mixed market, hot ipo market. in the next three days, more than a dozen ipos trade. hottest sectors, energy and biotech. look at foresight, priced at $20. pull over here -- priced at $20, opened at $20. here's the executives. a yield play. they are active in the coal business. they claim to be the lowest cost producer of thermal coal in the united states. problem is coal is out of favor right now, but people are looking for yield. look at last week, an ipo, spanish company, owning conventional power and electrical transmission assets.
yield at 3.5%. trading at $36. people are looking for yield plays. i think the hot ipo today will be over on the nasdaq. that's viper energy. energy ipos very, very hot right now, 5 million shares at $26. that's above the range. they talked 19 to 21, pricing at 26. this is the permian basin in west texas, not a dividend, but energy the hot ipo. century community small ipo home builders just opened at $23. hot ipo of the week, though, i think, is going to price shortly in the next day or so, market, a big financial services firm, 45 million firms, 23 to 25. it's large. everybody knows market in the business because they control credit default, swap, indexes, well known in that area, big financial services firm.
we'll keep an eye on that. the ipo, the renaissance caple, etf, asking 60, up about 10% in just the last month or so. movers today, fedex, earnings above expectations. good estimates for 2015, $8 preponderate 75. first quarterly decline, same store sales in a number of years, conagra cut earnings guidance. fun to have tesla here, elan musk, talking about solar panels. people don't get the amt for solar panel to gather more electricity is increasing every year. people who say solar is not important part of the energy business are completely wrong. major new investment in another solar company yesterday. musk, a lot of fun, stayed with us yesterday. back to you.
>> bob, thank you so much. let's go to the bond pits, rick santelli at the cme group. >> the treasury department dictates, rates down, and i think the reason traders talk about is yesterday on the cpi, it insighted the market in the face of weaker housing, like, less filling tastes great. we had very, very weak housing trumped by stronger inflation. today, we are down across the spectrum of interest rates, most likely traders say it's because nobody really believed janet yellen's marching to the tightening zone any time soon. even though many of the markets including the spreads are arguing for that flattening. okay. let's go, intraday two day, yes, enlightening, failed, open the charts up, fail at 266. want to pay attention to that. as we look at some of the
spreads, you know, two year is always -- twos and threes talked about yesterday because in europe when the u.k., especially, you see a lot of rise in that part of the curve selling, pushing rates up, flattening, tightening, moving closer. it has not moved much, but it is still in a zone of flattening not seen since last summer. here's where the action's at in the fives to 30s. a fresh five-year high, september of 2009, close to a fresh five-year, narrow because it is a flattening trade, and if we look at what's going on overseas, i think you really need to look at boons versus tents. this continues to trump 15-year wieds. an aggressive trade, issues with italy going on causing some of the spreads to move in europe, and it's probably not a big issue with eu complaints on how long it takes to pay private contractors. the last chart is the euro. look at this, a june chart. look at all the congestion on
the bottom, like the dollar yen. it doesn't look like it's breaking out any time soon, but if it does, it's a coiling spring at the moment. judge, back to you. >> rick santelli, thank you so much. mary barra back to capitol hill this morning, testifying at a house panel on the gm ignition switch recall. we are on the hill with a preview, bill? >> reporter: we heard from 15 victims or relatives of victims who were hurt or killed in recalled gm vehicles. they were basically saying, look, general motors needs to be held accountable. the ceo will be testifying in 15 minutes. we know what we expect her to say and some questions focus on this. first of all, her focus is on saying, here's the internal investigation, here's what we have found over the last three months, and these are the changes that general motors made in order to prevent this from happening in the future. this will be lots of questions from house of representative
members about compensating victims of these recalled vehicles. we do know that compensation plan is being worked out by ken feinberg, and mary barra says the plan will be in place by august 1st. the question is, is that enough in the eyes of the members of the house of representatives? again, this is about to start in 15 minutes, we'll hear from her, and, also, guys, more interesting the testimony of a former u.s. attorney who conducted the investigation of general motors, a scathing report released weeks ago. interesting to see if there's more details when he testifies. guys, back to you. >> thank you so much. latest in d.c. coming up, a futuristic message from space and elan mask. stick around to see what he told cnbc, and later on, a live interview with the ceo of adobe systems, one of today's big winner on the street. hear how the company is riding the cloud. we will be right back. we're moving our company to new york state.
making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies. become the next business seeing the world in reverse,. and i loved every minute of it. but then you grow up and there's no going back. but it's okay, it's just a new kind of adventure. and really, who wants to look backwards when you can look forward? take them on the way you always have.
live healthy and take one a day men's 50+. a complete multivitamin with 7 antioxidants to support cell health. age? who cares. i make a lot of purchases foand i get ass. lot in return with ink plus from chase. like 50,000 bonus points when i spent $5,000 in the first 3 months after i opened my account. and i earn 5 times the rewards on internet, phone services and at office supply stores. with ink plus i can choose how to redeem my points. travel, gift cards, even cash back. and my rewards points won't expire. so you can make owning a business even more rewarding. ink from chase. so you can.
people think, oh, we're trying to put the screws to various states to get as much incentives as possible. >> there's logic to it. >> it does, but that's not the goal. really, our main concern is to make sure that the giga factory is ready when the third generation car is ready because if we go and design the car and we wait to tool up to produce the rest of the car, also a big expense, but then there's no factories to supply it, terrible outcome for tesla. we might fail as a company. that has to be paramount in our decision making. >> well that's elan musk,
feeling confident he can produce the car in the next three years, tesla just one of the venture, and spacex named number within on cnbc's disruptor 50 list. no limit to where this guy's brain wants to take us. >> trying to be a combination of einstein and edison. i get that. the buffalo plant going to give back a little. tesla up because, you know, jersey going through to try to get this. the showroom's open again. i would say be careful again because these stocks are up huge, and they are, frankly, overheated. >> put it in the basket, and i think you did in the context of how you spoke about amazon, tesla, love the guy, love what they are doing, how can you not? look at the valuation, and it makes me nervous. >> look at march to may, no support for the stocks. the report about how many ipos,
day one of too many, and day ten, the same thing happens again. look, no one mewants to hear, b careful, it spoils the party. i have the right to say be careful. i have other stocks i like, plenty of others that sell at 17 or 18. >> you got six today. >> that's insane. the companies were barely vetted. the windows close because it's summer. insane. you lost money in every single deal, every single deal. every single deal during that period. >> all right. >> let's be careful. >> okay. up next, stock trading with jim. we'll be right back. [ female announcer ] there's a gap out there. that's keeping you from the healthcare you deserve. at humana, we believe if healthcare changes,
female announcer: then don't miss sleep train's 4th of july sale.?d care. right now at sleep train, save $300 on beautyrest and posturepedic mattress sets. plus, pay no interest for 36 months on tempur-pedic and serta icomfort. big savings and interest-free financing? these deals aren't just hot... they're explosive! don't miss sleep train's 4th of july sale. ♪ sleep train ♪ your ticket to a better night's sleep ♪ that's why i always choose the fastest intern.r slow. the fastest printer.
the fastest lunch. turkey club. the fastest pencil sharpener. the fastest elevator. the fastest speed dial. the fastest office plant. so why wouldn't i choose the fastest wifi? i would. switch to comcast business internet and get the fastest wifi included. comcast business. built for business. all right. it's time now for cramer, and stock trading, jim, number one on the list this morning, gwpharma. >> up 12 yesterday, piled secondary, do not freak out. the last secondary was 2.44 million shares at $36. you want to be in on the secondary. why? this is the only really legitimate marijuana stock out there. it's doing well. that's the good. the bad is conagra. this is amazing. a horrible quarter.
private branch doing poorly, consumer volumes poor. dividend is save according to the three-plus, the ceo, but a terrible number for chef boy-r-dee. do you think of natural and organnic? >> no, i think of the raviolli, it's good, throwing it out there. >> i think of the times that were not good at home. >> hey, man, was it -- just -- >> you know, rvl i think that the full line is out voted by the times, okay? not unlike when ragu was sold to the japanese. a lot of what's canned is not selling well, okay? >> i can't believe we're having a serious conversation. >> okay. tonight, now, these stocks
headed down, the nation's largest senior living, and best performer in the industry going down, and we have to talk about basic, an energy company. a new market not unlike the 1982-84 period. the stock is up human. why? positive down spacing results outside of denver. we are in the -- i found the new oil field and we're making money, the field in oklahoma, energy bet -- >> better than the shaggy field. >> totally right. do you remember that? >> yeah. >> how did you remember that? >> just broke that out. >> this time the monsters are for real. all right, simon hobbs has what's coming up. >> we'll take a look at whether the fed is going to surprise the markets by acknowledging that inflation is an issue and raising their expectations of
interest rates sooner and faster. interest rates rising sooner and faster. we'll preview the new 3-d phone amazon is supposed to launch in seattle. those who want to shorten the urls's in the court of the day, bit.ly's ceo will join us for hour two on "squawk on the street." ks how you want to work. with a fidelity investment professional... or managing your investments on your own. helping you find new ways to plan for retirement. and save on taxes where you can. so you can invest in the life that you want today. tap into the full power of your fidelity greenline. call or come in today for a free one-on-one review. call or come in today for a free one-on-one review. geicmoney for over 75 years.save they've really stood the test of time. much like these majestic rocky mountains. which must be named after the... that would be rocky the flying squirrel, mr. gecko sir. obviously!
ahh come on bullwinkle, they're named after... ...first president george rockington! that doesn't even make any sense...mr...uhh...winkle. geico. fifteen minutes could save you fifteen percent or more on car insurance. in a we believe outshining the competition tomorrow quires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.
the numbers are impressive. over 400,000 new private sector jobs... making new york state number two in the nation in new private sector job creation... with 10 regional development strategies to fit your business needs. and now it's even better because they've introduced startup new york... with the state creating dozens of tax-free zones where businesses pay no taxes for ten years. become the next business to discover the new new york. [ male announcer ] see if your business qualifies.
all right, welcome back, breaking news this morning. gm's ceo, mary barra, back on capitol hill today to testify before the house subcommittee on oversight and investigations. we are live in washington with what to expect from ms. barra today, phil? >> reporter: we saw comments from fred upton, the representative who leads the subcommittee. general motor's actions after reading the internal investigation as well as their own investigation, he calls those actions deplorable amongst a number of other words he uses, and he'll be saying those to mary barra when the hearing begins in a few minutes. we know mary wants to focus on the changes at regime motors, that gm will learn from this, will not happen again, and the questions from the committee members is how can we be assured this will never happen again? it will be interesting to see how heated exchanges become
between the representatives and mary barra as well as what questions are going to the former u.s. attorney who conducted the investigation for general motors. they have his investigation. let's see what questions they have for him in how far up the chain it went when it came to not identifies the problems with the cobalts and other vehicles with faulty ignition switches. we'll listen to the testimony and be out when there is news from the hearing. guys, back to you. >> all right, phil, thank you for monitoring for us. we'll check back with you. the other story, the federal reserve, story on interest rates delivered in a few hours followed by a press briefing of the janet yellen. steve is live in washington, d.c. with more on that. steve? >> reporter: thank you very much. a more interesting meeting, the big question is how much concern and tolerance the fed chair, janet yellen, and fomc have for
higher inflation, likely heated discussion at the meeting, rising faster than expected towards the fed's 2% goal. chances of a spike in headline prices and resulting passed through core inflation are rising due to geopolitical events meaning iraq and what's going on in the ukraine. he's some two measures of inflation. green is the number we got yesterday, up towards 2%. the blue is the inflation measure the fed follows, the pce inflation measure. it usually runs a little colder, i guess, than the cpi number. however, we don't have a report yet on that, and it could be that the next time around we get that report in the next week or so, this will run at or near the 2% inflation level. first of all, on the issue of inflation there, it may tolerate 2% inflation. one is rise, the other is
stable. rates and tapering are based on labor inflation, and, of course, the wage outlook, which has been stable. here's the fed's inflation forecast. we'll watch it today. 155 for 20 14. it could go up 175, not getting to the 2% goal inside the three-year window here. so depending on how yellen answers the questions on inflation today, we could emerge with a sense there's a risk here, accelerated expectation for higher rates or a steeper trajectory of rate hikes or maybe both. here's the fed's rate forecast, 1% for 2015. actually, above where the market is today, two and a quarter for 2016. let's assess that risk. a couple things. one month at 2% cpi and around the globe inflation going the other way, price increases are falling. it's disinflationary. it may be in the weak economy, price rises where wages are not
rising may not stick. it could cause consumers to shift to less expensive items or curtail spending. yellen could give this recent rise in prices a little time to play out before shifting course. simon? >> steve, quickly, it's scott. the comments from carney, from the boe, talk in the market suggesting, of course, that rate hikes could come sooner than the markets are anticipating. >> in the u.k. >> in the u.k. >> the thousandsing problem. >> in the u.k. some wonder if yellen sort of adopts a more hawkish tone for her today, and if people are too complacent about what's happening? >> that's a legitimate question with legitimate risk. two thinks that interest carney. interested on your take simon and scott. the house issue issue. it has real reasons to say that. the other thing is that every central banker wants to make sure there's a two-way trade there. a comment like that could take
steam out of markets whereas in the united states, for example, corporate debt market spreads are low. it looks like everybody's on one side of the trade. a comment like that could be based in the reality of underlying economics, but a little jawboning to create or take off a little steam in the markets out there. >> interesting. okay, steve, thank you very much for that. on more of this afternoon's decision and how it will impact the market, jim paulson, michael, chief u.s. economyist with jpmorgan. gentleman, good morning. >> morning. >> michael, cut to the chase. in three hours time, in the official statement, do they have to acknowledge that price pressures are building, and if they do that, do the individual estimates, the dots of when they expect interest rate rises have to indicate there will be rises faster than we think? >> right. first, i think we have to acknowledge the fed has been saying there's exceptionally low inflation numbers seen in the second half of last year, likely
to be transitory. what we see now is in large forecast the forecast being realized a touch faster than expected, but this is what they want. now, in terms of the interest rate dots or interest rate forecast, i would expect them to be probably marginally higher than the forecast in march. we had, since then, a decline in the unemployment rate, and as you point out, modestly higher inflation than i think they were looking for. >> jim, the problem is once they are engaged in the academic debate of how much slack there is in the economy, many people in the country, life is changing on a daily basis because of inflation. meat, fish, eggs, electricity, air fares all rocketing making the newspaper headlines today. you know, if they -- excludeing measures of courses, steve was inferring from the official forecast and what they are targeting with core cpi, they may stand accused of actually increasing inequality in the country if they don't move in the same way it's arguably qe
increased inequality by raising prices. >> as we know, historically, one of the greatest taxes you can impose on the middle class of america would be a significant problematic inflation run that eats up the purchasing power of the middle class wage earner, so, you know, there is on both sides. i think what i find interesting about today, simon, and the fed, whatever they do is going to have impact. if they just ignore the recent inflation or brush over it without much at all, that's very telling. they may come out with reference to maybe some inflation is good. it suggests better economy, we're getting there. that's telling. and if they come out more hawkish, of course, that's telling. i think however they deal with today's message, not only today, but in the next few weeks where we start hearing the different fed members speak, i think the bond market, particularly, but also stocks, are going to be impacted by this.
>> i'm wondering about the length here between the markets and the federal rereceiver. michael, to you, there's a few new faces at the federal reserve, stan fisher, vice chairman, dots included, abstained from placing actually interest rate forecasts, but i wonder if there's going to be more concern with the new federal reserve about the impact of policy and exit and forward guidance on what's happening in the markets and whether that affects the decision? >> i do. i actually think that's, you know, a very interesting aspect of the composition of the fed, as you say, they have spoken out in the past about kind of tuning monetary policy to take into account what's going on in asset markets. i don't think right now that means tightening in 2014 certainly, but i think as we get closer to the fed's mandate of full employment and price stability, this will increase in significance, and i think if we continue to see asset markets, this new fed, and maybe not yellen, but certainly a lot of the other committee members are going to start worrying about
whether low interest rates are fuelling. >> do you feel we have the equity market, the target where we are all the moment, there's a temptation as some suggested to cause turmoil deliberately so that it's not a one-way bet? >> i don't think it's wise for the fed to deliberately cause turmoil. at the same time, i think there is a little bit of a danger with their forecasts that may create too much complacency that what the fed is doing is giving us a promise about what happens in 14, 15, and 16 rather than a continue best guess as to what happens. there's a risk here the fed may be generating too much complacency, but right now, i'm not particularly worried about equity market nor do i think the fed should be injecting volatility in the markets. >> jim, everybody's focussing on the fed, but don't forget the situation in iraq either. how do we think about that in terms of investing in the market right now, in terms of risk, in
terms of the picture of complacency, and everything else? >> you know, scott, i'm not big on what investors should react a lot to events in iraq m i think you've already should have done that, and it's called diversification. if you are diversified, you should stay focused on other things that are more important, i think, coming off main street here than on the up certainty geopolitical risks that could always flair up, always change directions. that's why diversify, i think beyond that, you shouldn't do much. if you do, i think you risk moving, i think, poorly over time. you know, i think the thing they should focus on is the message and street. we're talking about the fed today, but it's important to recognize that the real rate setter, the real policy setter is main street. i think -- if the inflation rate goes up 2.5%, wages up 2.35%, it's clear.
the fed is taking its direction from data coming off main, and that's where i think investors should be focused. >> it's a big day, thank you for kicking off with us. don't forget to tune in to street signs at 2:00 eastern and the fed conference at 2:30. >> looks like the major averages are going in opposite direction. little change. let's go to domm chu. >> air products and chemicals, a record high. the company's biggest shareholder, bill ackman hiring rockwood to replace john as part of the management overhaul. rockwood specializes in chemicals and materials like lithium for ion batteries. stock trading 7 % up on the news. rockwood, the news he's leaving, is down about 4% in trading today, so, scott, a nice trade up here. good news for one company,
perhaps not as good for the other. back over to you. >> domm, thank you. ackman is enormously happy with the appointment the board made, a brilliant move, and the stock is doing well today. up next, just what does jeff have up his sleeve? most think the announcement is a 3-d smart phone. how do you play the stock ahead of the event in more on that when "squawk on the street" comes back. i spent my entire childhood seeing the world in reverse, and i loved every minute of it. but then you grow up and there's no going back. but it's okay, it's just a new kind of adventure. and really, who wants to look backwards when you can look forward?
female announcer: it means another neighbor is going to sleep better tonight because they went to sleep train's ticket to tempur-pedic event. choose from a huge selection of tempur-pedic models, including the new tempur-choice with head-to-toe customization. plus, get 36 months interest-free financing, two free pillows, and free same-day delivery. are you next? announcer: make sleep train your ticket to tempur-pedic. ♪ your ticket to a better night's sleep ♪ in just about three hours
from now, amazon is set to make a big announcement, widely expected to accompany a mobile phone with a 3-d display, the managing direct after ever corp. covering the stock. amazon, as the rest of the companies in the universe watch this launch today, who will be more worried or threatened by it? the hand set makers like samsung and apple or the content players like netflix and hulu? >> there's a big opportunity to put developers in touch with mobile consumers, and i think a.m.son has done a lot on the mobile developer side in helping app developers scale their businesses, but i think what it could do better for them is help them with distribution. i would say, you know, launching the phone while i wouldn't expect the phone to necessarily be a huge event by itself today, i think their entry into the market place is fairly important, and i think that you can expect amazon to continue to it rate and stay very focused on what the product will ultimately look like.
>> well, it's about the content offerings, e-commerce. is this like what we have seen before, not actually making money on the actual hand set, devices, the hardware, and going straight into the system of everything amson? >> if it is a success, you probably expect it to come out of gross margins. wouldn't have too much impact on the growth profit dollar growth, but i would expect for them to say, as they pursue this, there will be some fair amount of ration i feel, and, yes, how will they leverage asset contents and positions with developers to make it easier to get distributions with amazon and other partners. does this make sense to you? i call your attention to john ledger's tweet this morning, you know, t-mobile who says, hey, remember the facebook phone? >> right. >> you know, what does he say? hashtag yikes. >> it's interesting. they have come at it from the
other direction, strong with consumers, moving into the infrastructure side, allowing them to allow developers to build. i think amazon has given a stack to build on, but they have to get engagement with consumers, and build the opportunity like google is, like facebook, and i think amazon is in a good position. i'm not sure a 3-d screen gets them there. >> you see a 3-d image with a naked eye? three quarter of americans have a smart phone. the kindle market share is, and if it's a success, it's a success in territories the american public cannot see, which is what blackberry did. hugely successful there, and nobody gave a damn. in app environment where they are down 17% this year, this is potentially dangerous for them, isn't it? >> they have a history in the businesses. they don't want to lose money, but they kind of hold themselves
with not necessarily making money either. >> turning against that idea. isn't that why the stock is down heavily this year? >> i think you can look at this area, you could also look at the investments in content, the pricing wars across the cloud space, and i think that, yeah, you are seeing potential impact on their margins, and that's been reflected in the guidance too. >> not reflected in the stock. it's overweight. >> i do. >> the point is well taken. >> i do. ? the market turned on the amazon question, not willing to sit here and wait for the company to be more profrtle. >> certainly. i think that comes and goes. as the market turns away, look, we want to see profit growth here, margin expansion. we waited long enough. it's important to step back, though, and look how much volume goes through the amazon platform. look at that, separate value for aws, amazon trades as a multiple gross dollars, half of the brick and mortar guys. there's an opportunity as the view comes into -- some patience
returns to the story by investors, there's a good opportunity here. >> all right. you sound optimistic. we'll see what the launch has in store. >> thank you. >> thank you for joining us. tune into the cnbc original documentary," amazon rising" hosted by david faber, next sunday june 29 th at 9 p.m. eastern time here on cnbc. breaking news on sports, washington red skins, the battle over the mascot and names. hampton? >> reporter: scott, a shocker coming from the u.s. patent office which has cancelled the trademark registration saying the name is disparaging. this is the patented trademark office, a lawsuit brought by native americans against profootball and specifically the washington redskins. the key phrase in the decision saying that the football team's name is, quote, disparaging to native americans, federal
trademark law does not permit the registration of trademarks that are, in fact, disparaging to individuals or groups, and that, quote, bring them into contempt or disrepute. the specific case reinvolves around six specific uses of the redskin name in trademark-type business negotiations of one kind or another in particular. this decision can, in fact, be appealed to a federal court, but, again, we're raising the bar both legally and now politically, and, of course, impacting the sports fans in the area of the controversy surrounding the redskin's name name. u.s. patent office cancelling the registration of the washington redskins, back to you. >> people were out on various sides of the issue for years, really. the question now, i guess, becomes whether a decision like this compels daniel snider to
reconsider his own position which he is steadfast on that he will not change the name. >> yeah, absolutely, not only pressure on the owner of the redskins, but also nfl commissioner as well. this suit was brought against the redskins, but against all of profootball as well, and, you know, it is the overall owners group of which the redskins are a part that have a stake in the outcome of all of this. >> more generally, there is a question whether federal agencies should have the right to cancel patents that may be valuable to the private sector on a whim, and -- nobody obviousliments something that's racist out there, but there's a broader question here of something that is valuable that can be cancelled, hampton, in this way internally within a federal agency, surely. >> reporter: well i think you're now getting to issues that may come up in the actual appeal assuming this goes forward to the federal court, but in terms of the letter of the patent
offices's own regulations, you know, it's a clear guideline they were operating in for making thmake ing the specific decision around the redskin's name, key phrase, saying the name in the eyes of the patent war is disparaging. >> and that they should have never awarded it in the first place. great to see you. hampton live from d.c. up next, fedex delivering a beat for the fourth quarter and forecasting better results next year. the shares have a huge boost as you can see. should you buy fedex or ups? we're back after this quick break.
but airlines running hp end-to-end solutions are always calm during a storm. so if your business deals with the unexpected, hp big data and cloud solutions make sure you always know what's coming - and are ready for it. make it matter. when folks think about wthey think salmon and energy. but the energy bp produces up here creates something else as well: jobs all over america. engineering and innovation jobs. advanced safety systems & technology. shipping and manufacturing. across the united states, bp supports more than a quarter million jobs. when we set up operation in one part of the country, people in other parts go to work. that's not a coincidence. it's one more part of our commitment to america. dad: he's our broker. he helps? look after all our money. kid: do you pay him? dad: of course. kid: how much? dad: i don't know exactly.
kid: what if you're not happy? does he have to pay you back? dad: nope. kid: why not? dad: it doesn't work that way. kid: why not? vo: are you asking enough questions about the way your wealth is managed? wealth management at charles schwab. thank ythank you for defendiyour sacrifice. and thank you for your bravery. thank you colonel. thank you daddy. military families are uniquely thankful for many things, the legacy of usaa auto insurance can be one of them. if you're a current or former military member or their family, get an auto insurance quote and see why 92% of our members plan to stay for life.
take a look at the utilities sector. it is one of thee best performing sectors on the s&p 500. as we speak, domm chu with more. domm? >> it's the most performed so far, double the daily performance, another day, another record for dow utiliti s utilitiesiutilities index, breaking the previous all-time record high hit monday. among the leaders this morning are first energy, north ooegs utilities, public service, and enterprise group and cms energy, all doing well, the utilities index for the s&p 500 up over a percent today, scott, a nice day, assumed and still have the leadership role in the year to date performance for all sectors in the s&p.
back to you. >> domm, thank you so much. fedex trading at an all-time high after beating estimates by 10 cents, and the company says the fiscal year has been good, but 2015 will be even better. donald bratton, managing director has an outperform rating on fedex and a $165 price target. good to have you on the show. >> good to be here. >> a good read, snap back from the cold winter. >> oh, absolutely, absolutely. everybody's glad to see phil gone, but the bottom line is the outlook is rosy indeed. i was looking for $9 a share, consensus was $8.75, a range of 8.50 to 9, and when they get good momentum, set targets that are reasonable, spen in the next year or so beating and raising.
mart interpreted it correctly. >> this was ground doing well, freight doing well, but what about international. still remains an issue, doesn't it? >> it does. don't gloss over ground, it's up 8%, taking share away from ups. they had a lot of service issues with the winter and holidays. freight seeing a snap back in operating margin there, great progress in the restructuring there, but we're seeing internationally the fruits of two things happening. one, the continued investment in the new air fleet. triple 7 boeings are first time. we have the transatlantic area, transpacific area, just small amounts of positive volume leverage all the investment in new planes and new technology. >> and another catalyst could be, you know, after the holiday season when they start to
implement the different way that they charge for packages, by size and not just by weight, we know that ups is following suit. how much of a financial boost is that going to give the companies, specifically fedex? >> well, it'll help everyone. you know, what they really want to do is they want to discourage people from sending boxes with one item in it and a bunch of air in it because that's not good for the shipper, and it's not good for fedex, and so this dim weight packaging allows them to go back to the customer and say, look, let's redesign packaging. we don't want to ship air. you don't want to pay to ship air. that's what this does. it discouraging people from doing that. makes the overall system greener, more efficient, and in the end, more profitable for everyone. >> they forecasted gdp at 2.2%. a lot of this is out of their
control, and they are dealing with ma crow factors. is that the biggest risk in your view to the fedex and ups? >> no, i don't think so. i would tell you their economyist at fedex is one of the top in predicting -- he's always in the number one, number two, number three of the industrial economies out there predicting, i think because he cheats, sees every night what's moving through their system, but that said, i don't think that's the biggest risk. i think maybe more of the bigger risk is volatility and fuel. certainly, there's unrest in the middle east. a lot of volatility in fuel puts head winds or tail winds into the story, but i think the operating fundamentals are strong that it takes a lot to derail from here. >> all right. donald, thank you so much. >> always a pleasure. >> all right, donald with the latest on fedex, a mover today. ceo of fedex joins closing bell
this afternoon, don't miss that, another big interview for closing bell. all right, let's go to ja jackie deangelis. we have interesting action here in the pits. >> reporter: down 25 cents under $106 a barrel now after the department of energy came out with its weekly crude inventory report. we got a draw down of 600,000 barrels, a lot less than traders expected and less than what we saw from the api report from last night. a couple things to think about here is the reason we have a draw is refinery rates going up, they are using more oil to produce oil, but i do want to point out that we have steady dmesices gasoline command, nothing crazy right now, and it's iraq that traders watch the most. in the morning, they thought prices should be higher based on the turmoil watching there, but they are not. they are leveling off. right now, actually, we're down
4 cents right now. guys, back to you. >> jackie, thank you very much for that. ahead on the show, the sunni militants that attacked iraq's largest oil refinery as part of the ongoing offense across the country. we'll go live to iraq to give you an update on the grounds and give you a military analysis.
[ male announcer ] it's one of the most amazing things we build and it doesn't even fly. we build it in classrooms and exhibit halls, mentoring tomorrow's innovators. we build it raising roofs, preserving habitats and serving america's veterans. every day, thousands of boeing volunteers help make their communities the best they can be. building something better for all of us. ♪
it can help your business save money. false. the truth is when you compare our fastest internet to the fastest dsl from the phone company, comcast business gives you more for your money. why pay more for less? call today for a low price on speeds up to 150mbps. and find out more about our two-year price guarantee. comcast business. built for business. sunni militants in iraq
attacking the country's largest oil refinery. michelle is live in northern iraq with all the latest. michelle? >> reporter: first, we want to tell you about exxon-mobil, declining reports that they are conducting a quote-on-quote massive evacuation. they decline to comment, and there's caution on the report because of the source it's coming from. quoting an official from the iraqi southern oil company, so a government official and to give you some context, the story we have not had a lot of time to spend on, but last year or so, the international oil companies in the malawki government go head to head because of issues related to contracts, slow approval times for visas, approval on spending, some ceos of any -- for example, this year, came out and basted the government. there may be more to this than what meets the eye. there may be political tension
there behind the story. again, we can tell you that the majority of the violence, all the violence is in the north of the country far away from the production in the south of the country where exon-mobil has production. they have licenses in the north, but no production yet. the refinery under attack from militants. as a result, long gas lines in the northern part of iraq here, and then politically speaking, iraq's prime minister was on tv today -- national address claiming that the government has regained the initiative after, quote, the shocked defeat of his army last week. we'll continue dealing heavy blows to the militants. we are seeing a lot of violence on the ground. tame, neighboring iran, the president of the iran made a speech in a packed stadium today announcing iran will spare no effort in protecting sacred sites. the rebels are sunni saying, quote, the great iranian nation
will spare no effort in protecting these sacred sites. at the same time, iraq's counterterrorism troops fanned out across the capital city of baghdad today, heavily armed, wearing masks, check points checking vehicles, and u.s. special operation forces began a month of counterterrorism training for a group of iraqi military troops this past monday. they are doing it in nearby jordan. a lot of developments here. simon, waiting to hear from comes out of the meeting today. back to you. >> thank you very much, stay safe. on the ground in iraq this afternoon. for reaction now on the latest events, let's turn to the military analyst, general, welcome back to the program. >> good to be with you. would you agree with jay carney, the white house spokesman, summing up where the president is? saying the president has been clear this is not primarily a military challenge. it rests still with the
political leaders of iraq taking steps to become more united? >> well, i don't think there's much question that at the heart of all this, of course, a continuing struggle. inside these pre world war i boundaries. there's struggles between religious groups, so iraq is likely to continue coming apart in a sectarian war between the shia, sunni, and the kurds. that's the reality on the ground. >> others disagree with you, dick cheney writes in the journal today saying that president obama seems indifferent to the fact that an insurgent al qaeda presents a clear and present danger to the united states of america, and, indeed, the spee of the terrorist takeover in iraq matched only by the speed of america's decline on his watch. today's nbc "wall street journal
kwths poll says 37% of the americans think mr. obama is doing what's right on foreign policy. he has a problem. >> well, there's no question that -- well, my major concern is that the obama administration under domestic political pressure will decide to do something, and, you know, it's similar to a good position, do no harm is rule number one. it's hard for me to imagine that we have many tools, particularly military, that can, in the short run, address this problem. the whole notion that we can demand an inclusive government in a modest uprising in the sunni-arabs. the ability to influence events is limited. it is a long term threat to the united states, to oil supplies
in the middle east. we should be concerned, but it's not many we can do about it today. >> well, i mean, i don't know if someone agrees with you, but, look, we need to try because the clear and present threat, not just to the u.s. national security, but to the entire region in the middle east is very scarey, and very dangerous, and you don't see that urgency necessarily from the white house. what is their strategy if it's not going to be launching air strikes and getting involved right now? >> well, of course, you know, most of the discussion is over military tactics. are we going to use drone strikes or manned air or just provide enhanced intelligence? should we accelerate the delivery of ammunition and equipment to the iraqi army? at the end of the day, this is not really a blitz by the german army. there are not targets out there. this is a 9,000 fighter force, isis now joined by other
sunni-arab insurgent groups revolting against the central government which they perceive correctly as a shiite oppressive regi regime. the ability of the u.s. military power to this to do it surgically and remoesly is anemic. >> you make a good point, general, as is probably the point that the united states seems to lack authority. last time the president said there was a red line was in syria, and, clearly, that red line, even when he was pushed to it on chemical weapons didn't hold in the face of public. in congress. i would ask you a very simple question. on the world stage, who is president obama's greatest ally and leadership friend that actually can influence situations as they unfold in, for example, the middle east, with whom is he friends? with whom has he spent time
ingendering a soft power? >> well, i think it's -- we're in a difficult position. the credibility of the obama team is low. syria, a disaster, lebanon not much better. our current position in iraq does not lend itself to quick solutions. i think the obama team had been trying to withdraw from these conflicts. 2 two-thirds of the american people do not support this, and looks indecisive, a political problem. that does not argue, however, for doing something decisive and stupid in the short run. >> all right, regigeneral, thanu so much for the latest on the situation in iraq. meantime, breaking news on chrysler. phil, on a day you cover gm and barra on the hill, what is it? >> reporter: the highway traffic
safety administration is investigating ignition switches in a number of models. unclear how pervasive this problem and issue is, but any time you talk about ignition switches now, following what happened with general motors, it gets attention. the national highway traffic safety administration investigating whether or not there is an issue with certain chrysler models, 2005 to 2011 models, a number of them involved. it will be interesting to see how widespread. it is only an investigation. we are here at the house committee that is investigating gm's ignition switch recall. that hearing began, oh, about 45 minutes ago, and at this point, the most interesting question has come from the lead of this committee, representativive murphy, who said, i find it hard to believe with a company with 210,000 employees and not one person spoke up. some of the questions are pointed right now for gm's ceo, mary barra, and the former u.s.
attorney who conducted the internal investigation for general motors. back to you. >> thank you so much. up next, if you shorten a link when you tweet, you know bit.ly. it shortens more than 2 billion links a month and makes money doing it. the ceo of bit.ly joining us live at post nine when "squawk on the street" comes right back. ♪ ♪ ♪ ♪ [ tires screech ] chewley's finds itself in a sticky situation today after recalling its new gum. [ male announcer ] stick it to the market before you get stuck.
get the most extensive charting wherever you are with the mobile trader app from td ameritrade. wherever you are with the mobile trader app we stathat the kid onhe thought the back of the bus might have a song that he has in his head but he just can't get out. with the technology of cloud, we change all that. i can sing something into my device. up to the cloud it goes. back down it comes sounding better. we break down the walls of creation, and we give music creation for the masses. ♪ ♪ ♪ [ girl ] my mom, she makes underwater fans that are powered by the moon. ♪ [ birds squawking ] my mom makes airplane engines that can talk. [ birds squawking ] ♪
welcome back to "squawk on the street," check out fedex, trading at all-time highs today with e-commerce on the conference call this morning, the company is watching fuel costs, events in iraqi could be, quote, a wild card moving the new ground package pricing in january. fedex is more interested in helping customers pack more efficiently than clerking surcharges on bigger packages. fedex's ceo, fred smith, is live
on closing bell at 4:00 eastern on cnbc. back to you. >> thank you, morgan. whether you are a twitter user on the edge of 140 characters or want to know who is clicking links you share and how many times, our next guess is trying to solve the digital problems. mark josephson is the ceo of bit.ly. shortening links, and if you're like me, a twitter user, i use it every time i tweet. the question is, though, how do you make money 1234 i don't pay. >> sure. having a great product is important. we work with more than 40,000 brands to measure the performance of their links and are paid on a monthly basis to do that. >> i can access analytics, which i think a lot of people don't know, and i think that's important for the company because you are trying to branch out and earn money. >> it's a complex land scape for marketers today in figuring out
what is working and what is not. bit.ly is working since 2008 with more than 40,000 brands to understand who is clicking on the links, what's working, what's not working, is facebook better than twitter for this campaign, et cetera. >> what is better? >> depends who you want to reach. >> who clicks on more links, from which source? >> depends by customer, but facebook is hijack and growing, and twitter as well. >> how granular is the data? >> we help marketers understand who clicks the links, how many shares, where it went, and how it performed. >> basically, how far a campaign spread? >> yes. >> why not just buy you then? google has its own. google, wouldn't they need a company like yours for that competitive advantage? >> every market needs a trusted third party, and one of the big things about bit.ly is since the beginning, we are a trusted
arbiter, and so we work directly with all the markets and brands to be successful on facebook and twitter. >> you see yourselves likely to be bought really think that much about the exit, much more about serving the marketers and we've seen -- nobody goes into business without thinking how they'd make money. otherwise, it's a charity event. >> we are trying to serve marketers. adobe news is a great example what's happening in the market. market trying to simplify the complexity. marketers are flocking to solutions. there's adobe sales force oracle ibm making big plays and the marketing channels like facebook, twitter and google. >> what's it like for a company of your size to suffer a security breach? >> not fun. by any stretch, but it's a -- concerning trend in respect seem to be lots more of these
happening lately. the best with know how to do, do everything to be secure up front, transparent about what we're doing and how to resolve it and be proactive. >> how much does it cost? given your size, a more serious issue from that perspective than when it potentially hits somebody else bigger? >> we're pretty big. right? shortening more than half a billion link as month. 8 billion click as month. 40,000 brands, baked into over 4,000 flat forms, we're pretty big. we do well, scale. we operate massive scale across the web. so handling those things you need to be pretty nimble. >> thanks for joining us and sharing your thoughts and expanse plans. mark joefs josephson, ceo of bitly. still ahead on the show -- i've got a life. still ahead on the show, the ceo of adobe joins us live for the
first interview after the companies results. trading near an all-time high. back after a quick break. and it feels like your lifeate revolves around your symptoms, ask your gastroenterologist about humira adalimumab. humira has been proven to work for adults who have tried other medications but still experience the symptoms of moderate to severe crohn's disease. in clinical studies, the majority of patients on humira saw significant symptom relief, and many achieved remission.
humira can lower your ability to fight infections, including tuberculosis. serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. blood, liver and nervous system problems, serious allergic reactions, and new or worsening heart failure have occurred. before starting humira, your doctor should test you for tb. ask your doctor if you live in or have been to a region where certain fungal infections are common. tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. you should not start humira if you have any kind of infection. ask your gastroenterologist about humira today. remission is possible.
that's why i always choose the fastest intern.r slow. the fastest printer. the fastest lunch. turkey club. the fastest pencil sharpener. the fastest elevator. the fastest speed dial. the fastest office plant. so why wouldn't i choose the fastest wifi? i would. switch to comcast business internet and get the fastest wifi included. comcast business. built for business.
welcome back to "squat on the streeton "squawk on the street." andrew, confessions of a quantitative easier. on a bond buying spree supposed to help main street, instead a feast for wall street. welcome, andrew. maybe you can explain, you worked at the federal reserve. tell us in what capacity and directly what your job entailed. >> sure. i got to the -- spent about nine years at the fed overall but the reason i wrote the piece is because i was there at the beginning of qe, the first round of qe and basically i mpged the $1.25 million mortgage bond buying program the fed had and was there from 2009 to 2010 and basically that's what precipitated my op-ed. >> now, so you wa there for qe 1. do you think it was a success?
>> very defensible. we have to realize where the u.s. kmip was at the time, in the fourth quarter of 2008 we had seen 2% gdp contraction in three months alone and the fed trying to do something new to help promote the economy and i think it worked in terms of helping delever the banks. the problem, it didn't trickle down meaningfully to the u.s., to main street and now we've seen over another $3 trillion of bond buys by the fed. that's where the problem i believe lies. >> in your synopsis, who benefited, so to help main street, but is main street who benefited? >> no. i mean, i think on some level you have to say by stabilizing wall street we did help main street on some level. >> okay. somewhat. okay. >> but if you look where we are today, the six big banks, too big to fail banks, so to speak are actually 37% bigger than they were in 2008. >> did they benefit directly from the quantitative easing
programs? >> for sure. the fed unfortunately works through the banking system. its tools work through the banks. so by desfinition wall street hs gotten hundreds of billions of subsidies fry s froies from qes. what happens when the punch bowl gets taken away. >> and saying no more volatility, economy's no good. the volatility was sucked out with the money on qe. is that a fair statement? >> i think so. i think we've basically created a lot of complacency in the markets. this is 30-year story of the fed and u.s. government more and more rescuing the markets. i think the end of volatility is a short-term thing, unfortunately. >> that's the end game of the program. listen, we're out of time, andrew. i could talk to you for a while. i want to have you back to talk
in more detail agency the qe programs wind down. thanks for taking the time. back to you, remember the op-ed, everybody talking about it. thank you, rick santelli. over to jon fortt, with a look at what's coming up next on "squawk alley." >> breaking down the money behind amazon smartphone play. i'll have adobe ceo right here to talk the big earnings beat and what's next for the cloud, and then fire up your browsers or phones right at 11:30. cnbc.com/vote, get involved in the show, coming up on "squawk alley." just waiting to be found. tdd#: 1-800-345-2550 at schwab, we're here to help tdd#: 1-800-345-2550 bring what inspires you tdd#: 1-800-345-2550 out there... in here. tdd#: 1-800-345-2550 out there, tdd#: 1-800-345-2550 there are stocks on the move. tdd#: 1-800-345-2550 in here, streetsmart edge has tdd#: 1-800-345-2550 chart pattern recognition tdd#: 1-800-345-2550 which shows you which ones are bullish or bearish. tdd#: 1-800-345-2550 now, earn 300 commission-free online trades. tdd#: 1-800-345-2550 call 1-888-648-6021 tdd#: 1-800-345-2550 or go to schwab.com/trading to learn how.
tdd#: 1-800-345-2550 our trading specialists can tdd#: 1-800-345-2550 help you set up your platform. tdd#: 1-800-345-2550 because when your tools look the way you want tdd#: 1-800-345-2550 and work the way you think, you can trade at your best. tdd#: 1-800-345-2550 get it all with no trade minimum. tdd#: 1-800-345-2550 and only $8.95 a trade. tdd#: 1-800-345-2550 open an account and earn 300 commission-free online trades. tdd#: 1-800-345-2550 call 1-888-648-6021 to learn more. tdd#: 1-800-345-2550 so you can take charge tdd#: 1-800-345-2550 of your trading.